When analysts provide basic EPS for income from continuing operations that exclude the effects of special (i.e., nonrecurring) gains or losses and certain other non-cash charges, such earnings are frequently referred to as:

Multiple Choice

• pro forma earnings.

• real earnings.

• sustainable earnings.

• normal earnings

2. Investors and analysts must have certain capabilities regarding financial reporting which include:

Multiple Choice

• an understanding of current financial reporting standards.

• an ability to recognize that financial statement information reported is grounded in judgment as well as facts.

• all of these answer choices are correct.

• recognition that management selects the financial reporting standards used.

3. When a borrower violates a loan covenant that requires the minimum achievement of an accounting measure in the financial statements, the lender can:

Multiple Choice

• calls for immediate repayment of the loan.

• report the borrower to the IRS.

• fire the chief operating officer of the borrower.

• immediately seize the loan collateral.

Answer rating: 100% (QA)

1 Answer Sustainable earnings Sustainable earnings are the earnings that exclude the effects of spec... View the full answer